Madrid city officials have rejected Real Madrid's plans to upgrade the Santiago Bernabeu stadium.
The city says it will only accept a remodelling proposal that does not affect the interests of local citizens.
A Spanish court earlier this year annulled permission granted to Real Madrid by the previous city government, saying it broke Spanish land use law.
The city said on Wednesday that a new project will only be considered if it is "in the best interests of the general public."
Real Madrid wanted to remodel the stadium's exterior, and add a hotel and a shopping centre.
Opened in 1947, the 80,000-capacity Bernabeu was last redeveloped for the 1982 World Cup, although it has received minor upgrades through the years.